Abstract:
Organizational decision-makers perceive capability gaps when they expect that organizational aspirations can no longer be achieved with an existing capability configuration. In this study I develop a framework for explaining the factors that influence the perception of and the reactions to such capability gaps. In particular, I argue that perception of capability gaps initiates organizational search processes that can trigger four different responses: capability renewal, capability replacement, capability redeployment, and capability replication. Capability replacement and renewal involve capability reconfiguration; capability redeployment and replication serve the purpose of capability reorientation. This study contributes to research on strategic change from a competence-based perspective by shifting attention from separate capabilities toward those particular mechanisms that enable firms to cope with technological change. In addition, this study integrates behavioral concepts with the dynamic capabilities perspective by putting forward the notion of aspirations as baseline to which decision-makers assess the usefulness of capability configurations and by analyzing the role of attention and slack as moderators of those search processes that follow the perception of capability gaps.